back start next[start] [1] [2] [3] [4] [5] [6] [7] [8] [9] [10] [11] [12] [13] [14] [15] [16] [17] [18] [19] [20] [21] [22] [23] [24] [25] [26] [27] [28] [29] [30] [31] [32] [33] [34] [35] [36] [37] [ 38 ] [39] [40] [41] [42] [43] [44] [45] [46] [47] [48] [49] [50] [51] [52] [53] [54] [55] [56] [57] [58] [59] [60] [61] [62] [63] [64] [65] [66] [67] [68] [69] [70] [71] [72] [73] [74] [75] [76] [77] [78] [79] [80] [81] [82] [83] [84] [85] [86] [87] [88] [89] [90] [91] [92] [93] [94] [95] 38 OXFORD HEALTH PLANS (OXHP): DAILYBULLISH AB=CD .©iiaCharts.comllllllliniiiliiii20 19 IS 1? 16 15 14This ideal AB=CD occurs frequently in many stocks, although it is an incredibly simplistic pattern. It is important to recognize the significance of the AB=CD pattem, because it will get you to "buy low and sell high." Lets look at another example.The following chart of Procter and Gamble is a great example of an almost exact AB=CD. The stock sold off sharply during the summer of 1998, as it lost over 25% ofits value within a few months. However, the price action was quite harmonic.The stock sold off from its high in July at 94 (pt. A) to a low in the beginning of August at 75 5/8 (pt. B), forming the AB leg. Procter and Gamble bounced a bit and then reversed after slighdy exceeding the .382 retracement of the AB leg. Projecting an equivalent leg down from point indicated that the exact AB=CD pattem would complete around 65.PROCTEMGAMBLE (PG): DAILY BULUSH AB=CD100 95 90 85 8010.0Feb HarAlthough there were not any primary Fibonacci projections converging exactly in this area, the 2.24 of was calculated at 66. This is a good example ofthe secondary Fibonacci numbers complementing a clear pattem. So, when the stock sold off into this area, you should have beenpaying close attention for a potential buying opportunity. I have included the following enlarged chart that clearly shows how the stock bounced off this potential reversal zone.PROCTER&GAMBLE (PG): DAILY BULLISH AB=CD r PRICE ACTION IN THE POTENTIAL REVERSAL ZONE2.24BC @ 66 AB=CD @ 65yolUKie eBlsChai-ti.cohiuUliiil86 84 S2 80 78 76 74 72 70 6B 66 64 6 4 224 26 28 Sep 3 8 10 U 16 18 22 24 28 SOOct 5 7 9 13 15The price action was quite strong on the day Procter & Gamble hit this area, especially since the stock gapped down and possessed an extreme price range. Despite these waming signs, the stock reversed just shy of the exact AB=CD completion point. The AB=CD completed at 65 1/8, and the stock reversed at 65 1/4. As far as I am concemed, an 1/8 of a point shy is essentially an exact AB=CD.Even if you missed the opportunity on this day because you were waiting for the exact AB=CD to complete, the reversal provided clear signals of a reversal. Within a week after the reversal, the stock headed higher. This resulted in a significant profit, as PG rallied over 25 points during the next three months.[start] [1] [2] [3] [4] [5] [6] [7] [8] [9] [10] [11] [12] [13] [14] [15] [16] [17] [18] [19] [20] [21] [22] [23] [24] [25] [26] [27] [28] [29] [30] [31] [32] [33] [34] [35] [36] [37] [ 38 ] [39] [40] [41] [42] [43] [44] [45] [46] [47] [48] [49] [50] [51] [52] [53] [54] [55] [56] [57] [58] [59] [60] [61] [62] [63] [64] [65] [66] [67] [68] [69] [70] [71] [72] [73] [74] [75] [76] [77] [78] [79] [80] [81] [82] [83] [84] [85] [86] [87] [88] [89] [90] [91] [92] [93] [94] [95]